More than 248,000 taxpayer identity thefts happened in 2010, according to a report done by the Government Accountability Office.  The IRS is heavily dealing with a large increase of taxpayer identity theft.  In 2008, there were only 51,700 cases, but what exactly is taxpayer identity theft?  Well, I'm glad you asked.

Taxpayer identity theft occurs when a victim is scammed out of their tax refund from the government because someone else has already filed and collected their tax refund using the same name and same social security number.  A taxpayer doesn't realize they have been victimized until they actually go to do their return.


The IRS, fortunately, takes the time to figure out which return is the legitimate one and then goes from there.  However, the damage is already done, as far as I'm concerned.  Your identity has been jeopardized, security has been breached, and what's to say the person won't try it again.  If they already received the tax refund, then they already have what they wanted -- money! 

It's a very scary world out there.  Always be leary about giving out your social security number.  There are so many places and businesses that ask for your social security number so that they can identify you ever time you come into their office, however; certain places do not really need them and therefore, cannot mandate that you cough it up.  Be skeptical and always ask if they really need your number before putting it down.  You never know whose eyes are coming across your information.